Correlation Between Caseys General and TRADEGATE
Can any of the company-specific risk be diversified away by investing in both Caseys General and TRADEGATE at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Caseys General and TRADEGATE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Caseys General Stores and TRADEGATE, you can compare the effects of market volatilities on Caseys General and TRADEGATE and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Caseys General with a short position of TRADEGATE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Caseys General and TRADEGATE.
Diversification Opportunities for Caseys General and TRADEGATE
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Caseys and TRADEGATE is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Caseys General Stores and TRADEGATE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TRADEGATE and Caseys General is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Caseys General Stores are associated (or correlated) with TRADEGATE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TRADEGATE has no effect on the direction of Caseys General i.e., Caseys General and TRADEGATE go up and down completely randomly.
Pair Corralation between Caseys General and TRADEGATE
Assuming the 90 days trading horizon Caseys General Stores is expected to generate 1.36 times more return on investment than TRADEGATE. However, Caseys General is 1.36 times more volatile than TRADEGATE. It trades about 0.04 of its potential returns per unit of risk. TRADEGATE is currently generating about -0.1 per unit of risk. If you would invest 34,703 in Caseys General Stores on October 13, 2024 and sell it today you would earn a total of 2,897 from holding Caseys General Stores or generate 8.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Caseys General Stores vs. TRADEGATE
Performance |
| Timeline |
| Caseys General Stores |
| TRADEGATE |
Caseys General and TRADEGATE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Caseys General and TRADEGATE
The main advantage of trading using opposite Caseys General and TRADEGATE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Caseys General position performs unexpectedly, TRADEGATE can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in TRADEGATE will offset losses from the drop in TRADEGATE's long position.| Caseys General vs. Apple Inc | Caseys General vs. Apple Inc | Caseys General vs. Apple Inc | Caseys General vs. Apple Inc |
| TRADEGATE vs. Easy Software AG | TRADEGATE vs. Minerals Technologies | TRADEGATE vs. SOFI TECHNOLOGIES | TRADEGATE vs. Chuangs China Investments |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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